Emotions are an important, yet understudied aspect of early-stage investors’ decisions. In this article, we study how the negative counterfactual emotions of regret and envy may impact these individuals’ intention to invest in a new venture opportunity. We take into account the negative emotional consequences of both errors of commission and omission in this context, as well as its social embeddedness in our conceptualization. We make predictions regarding the direction and relative magnitude of the effects of counterfactual emotions on investment intention and test them in two decision-making experiments using a sample of investors. Our findings provide preliminary evidence that shows counterfactual emotions are relevant factors in early-stage investors’ decision-making process.
